Special State Report - Summary of Enacted Biennial Budget 2015

Summary of Enacted Biennial Budget – HB 1001

Introduction

The biennial budget conference committee was passed by the General Assembly during the waning moments of the final day of the legislative session, April 29. Generally, the operating appropriation levels are similar to the House-passed budget while the miscellaneous higher education provisions included in the Senate budget were retained. In addition, language was added permitting universities to bond for unfunded liability payments in connection with a total withdrawal from the state’s retirement system (PERF).

Operating Appropriations

The percentage increase in university operating appropriations for all public institutions is 1.7% in FY 2016 and another 1.8% in FY 2017.

For the IU system, reflecting our success with the performance funding metrics, operating increase by 2.8% in FY 2016 and another 2.5% in FY 2017. A separate table produced by IU’s Budget Office details operating appropriations for each campus.

Performance funding is set at 4% of total university operating appropriations (excluding the IU Schools of Medicine and Dentistry) in FY 2016 and 6.5% in FY 2017. Reallocation of university operating appropriations to help fund the performance funding pool is 2.4% in FY 2016 and 3.2% in FY 2017.

While neither of IU’s new line item requests for statewide engagement or for regional campus student success initiatives were funded, the budget does transfer the existing $2.5 million per year in funding from IEDC to IU for CTSI, as requested by IU.

Most existing line items were increased by 2% in the first year of the biennium.

The bill updates the names of the Centers for Medical Education, as requested by IU.

In concert with HB 1323, the budget includes $3 million annually for an expansion of graduate medical education (residency) slots, also sought by IU.

Capital Projects

Bonding authorization is provided in the amount of $48.5 million for the IUB Old Crescent Renovation-Phase II

$25.2 million in cash funding is included for the Evansville Academic Health Science facility. The bill specifies that $19.2 million is for the IU portion and $6 million for the University of Southern Indiana space.

State formula R&R is appropriated at $24.7 million for the biennium. In addition, $12.5 million for the biennium is included to address deferred maintenance at IU’s regional campuses.

The bill does not include funding for improvements to Carroll Stadium on the IUPUI campus in connection with its use by the Indy Eleven soccer team.

Other Provisions

The bill stipulates that the administration cannot withhold state appropriations to state universities without State Budget Committee review

The bill permits entities currently audited by the State Board of Accounts to employ private auditors instead

The bill requires that the Legislative Services Agency review the current governance of IPFW and alternative models for governance

The bill designates IPFW a “multisystem metropolitan university”

The bill requires the Indiana Commission for Higher Education (ICHE) to annually report the percentage of resident and non-resident students

The bill requires the ICHE to report any tuition increases imposed by the universities for the 2015-16 and 2016-17 academic years

The bill requires the Indiana Commission for Higher Education to review Ivy Tech programs with low graduation rates and authorizes ICHE to require restructuring or elimination of such programs

The bill includes language requested by IU that authorizes sale of a bond to finance total withdrawal from the state’s PERF retirement system

The bill includes language for the ICHE “return and complete” program.